The Debt
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Details
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$30,000
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Renovating our old house – we completely gutted and renovated a 1928 home. Which we bought for $150K and sold 3 years
later for $225K. The
profit was used to pay the downpayment on our new house along with real
estate fees, paying off a small renovation loan, and a hefty $10K buy out
from our old mortgage provider so we could switch to a lender with a lower
interest rate.
This debt is on a low interest student line of credit (one of
the benefits of being a student).
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$10,000
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This debt is my biggest regret. It was for my
first car, which was around and in good repair for about 6 years. This
equates to about $150/month if I had of paid it off over those 6 years.
Instead I just made interest payments each month. Sigh…again this is a
“student debt”.
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$2,000
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DH’s debt from attending college
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$2,000
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Approximate remaining payments left on our
two vehicles.
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$20,000
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Mostly made
up of bad purchasing decisions or covering large expenses like
"unforeseen" vet bills, car repairs, etc. Just over half of this is
on a consolidation loan that we are actively paying off and will be gone in
just under 2 years. $5K is spread over 2 visas and about $4K is a loan through
a family member that I am paying off at about $700/month and should be gone
by the Spring.
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Sunday, November 11, 2012
Debt Breakdown
When I originally posted about our goal "Debt Free by 30", Kelsey asked whether this debt included debt for our house or schooling. I thought I'd share the answer to this question and provide a breakdown of our debt as promised (numbers are approximate). The orange is our priority debt (high interest/smaller loans/family). The rest is mostly hanging out on interest-free status while I'm still a student until the Spring and then we'll have a 6 month grace period before repayment begins. Consequently, we want to get rid of as much of the orange as possible before we start repayment of the other "student debt". Next week I'll have an update on our progress! *Note: We do have a mortgage on our house and don't consider it as "debt" since technically we could sell our house tomorrow for more than what we paid and retain the equity.
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3 comments:
Awesome, thanks for sharing! Love your debt free by 30 plan, you can do it! What an amazing feeling that will be. We need to look at paying down our debt faster, it does feel overwhelming though, ours is over $200,000 with house and student loans.
I know a lot of finance gurus don't classify house debt as debt since equity is an asset and chances are you won't lose money on a sale transaction. That said - I think you've eluded to housing prices in your area being affected by the housing market crash in the States. I guess I would only considering housing "debt" as that which you might not be able to recoup should you decide to sell. Maybe it won't seem so overwhelming if you take the housing out of the equation :)
Eep. I also made a note in the post since I realized it probably looks like we don't have a mortgage on our house. We definitely do! We have approx. $50K in equity in our house which is worth about $315K so if we counted the mortgage we'd be upwards of $300K in debt. I much prefer the $64K figure!
Think.. if you consider your house as a debt, you'll magically have a couple hundred thousand in equity as soon as you pay off all your "debt". Doesn't sound so bad, eh?
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